Saturday, 25 May 2013

Is the PPI scandal past its peak?

PPI scandal, the biggest ever scandal to
hit the UK financial sector basically arose from the fact that the PPI policies
were mis-sold. The financial institutions and banks which provided the PPI did
not give out the accurate and complete information about the policy to the
customers. The misleading information only increased the number of complaints
that the customers had against PPI as, following the recession, 85% of people who tried to make use of the policy were declined as they were ineligible to make a claim.

The number of people claiming back PPI increased ever since the Bankers’ Association decided not to appeal
against the High Court ruling against the mis-selling of the PPI. However, the
latest figures released show that the number of claims that the banks and
financial institutions are getting has reduced. The FSA was scrapped on April
1, 2013 and in its place the FCA or Financial Conduct Authority now handles all
complaints against the PPI. The FCA also releases figures on the complaints
that are received by specific bodies in the financial sector.

As per the figures released by the FCA,
there has been a slight decline in the number of PPI mis-selling scandal in the
second half of the year 2012. During the second half, there were a total of 2.1
million complaints that were received as compared to 2.2 million complaints
that were received during the first half of the same year.

The figures, however, also revealed the
fact that the number of complaints received regarding PPI was the largest in
the sector. An estimated 63 % of all complaints received were against payment
insurance. A number of institutions have also been fined for failing to meet
the PPI claims. In addition, banks
are now pushing for a deadline to be applied to the PPI claims.

Thus, it seems that the worst is over and
that the PPI scandal is past its peak.